Passengers roast that ticket prices are too high Air New Zealand: driving is not cheap
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Civil Aviation Resource Network, April 29, 2025: According to Stuff, in response to recent public criticism of high domestic flight prices, Air New Zealand stated that air travel is still a relatively affordable way of transportation, while also noting that "driving in New Zealand is not cheap either".
Recently, Stuff solicited readers' opinions on the ticket price of Air New Zealand. After passengers complained about the high price of domestic routes, a man even filed a formal complaint with the New Zealand Commerce Commission about the ticket price. The government also stated that it does not rule out the possibility of enhancing market competition by guaranteeing the expansion of small regional airlines.
The poll results on whether ticket prices are "too expensive" show that an overwhelming majority of readers chose "yes". To this end, Stuff interviewed Richard Thomson, Chief Financial Officer of Air New Zealand, to listen to the company's explanation of the fare mechanism.
Thomson said that in the past three and a half years, Air New Zealand has experienced more cost inflation than in the past decade, due to factors such as the pandemic, weak New Zealand dollar, and geopolitics. Our overall costs have increased by about 30%, while the average domestic flight ticket price has increased by about 24%. We have made every effort to absorb the cost increases from all aspects. Air New Zealand's "cost items" include hundreds or even thousands of items such as fuel, labor, airport fees (which are also increasing), maintenance, and engineering. Thomson pointed out that due to the general increase in interest rates and living costs, passengers will feel more clearly the pressure of rising ticket prices.
When asked if ticket prices would increase on weekends or public holidays, Thompson said that ticket prices "may not necessarily increase" during these time periods. Thomson stated that Air New Zealand did not adopt a "dynamic pricing" system, but instead adopted a "revenue management" model. The so-called revenue management is a way for enterprises to optimize prices and supply by predicting customer behavior through data analysis. This model is adopted by the vast majority of airlines worldwide.
Thompson bluntly said, "We are an island nation, and flying is still a necessary way to connect 20 airports across the country. Operating commercial flights itself is a high cost business, and it has become even more expensive in the past three to four years
He stated that the only comfort he can provide to travelers is that ticket prices will not increase by another 30% in the next three years. Flying is still a relatively affordable way of transportation. Although some people buy tickets for NZD 400 or NZD 500, there are also thousands of examples of tickets for NZD 129 or even NZD 99
He gave an example that there was once a passenger who traveled from Timaru to Napier before Christmas, and the one-way ticket price was as high as 600 or 700 New Zealand dollars. But if you choose to drive, you may have to spend $100 on gas to get to Pickton first, $250 to $300 on the ferry, and $50 to $60 on gas to get to Napier... driving is not cheap either